BVB beat los Blancos in the semis last season before going on to lose the tournament decider to Bayern Munich at Wembley.
But with the current Dortmund side devastated by injuries, Watzke was downbeat at Friday’s draw in Nyon.
“We would have liked something different,” he told Sky Sports.
“We played Real four times last year but we take it as it is. We look forward to meeting probably the biggest club in the world again.”
Striker Robert Lewandowski scored all four goals as Dortmund thrashed Madrid 4-1 in the first leg of last year's semi-final last April but will miss this year's trip to the Santiago Bernabeu due to suspension.
His absence, plus injuries to Jakub Blaszczykowski, Lars Bender, Ilkay Gundogan, Marcel Schmelzer, Nevan Subotic and Marco Reus and the departure of Mario Gotze to Bayern, mean it will be a very different side taking on Carlo Ancelotti’s men this time round.
Watzke added: “Our problem is half the team that defeated Real last year will not be there.”